Housing market's recovery appears at risk

25/03/2010 10:51

The recovery in the housing market is at risk of Nike Air Jordan Shoescollapsing.
Home sales are sliding, prices are stalling and foreclosures are rising. air jordanAnd
mortgage rates are likely to go up after next week, when the Federal Reserve ends a program that has driven them down.
The trend could threaten the broader economy,air jordan shoes economists warn. People
whose home equity is stagnant or shrinking are less likely to spend freely.
In a move that will help at least some homeowners avoid foreclosure,Nike Air Max Shoes
Bank of America unveiled a $3 billion plan Wednesday to help some of its most troubled borrowers. It said it will forgive up to 30 percent of their total
mortgage balance. About 45,000 borrowers are expected to qualify, the bank said.
The plan is part of an agreement the bank reached in 2008 with state Air Maxattorneys
general involving high-risk loans made by Countrywide Financial Corp.Air Max shoes before
Bank of America acquired it.
Still, it's the first time a lender has announced a broad plan toNike Shox Shoes reduce
mortgage principal when home values drop well below the amount owed. Bank of America collects more Americans' home loan payments than any otherair shox company.
Only a few months ago, the housing market had been showing signs ofair shox shoes strength as
it recovered from the most painful downturn in decades. Much of the improvement, though, came from government programsNike Basketball Shoes that held down mortgage rates and provided tax breaks for buyers.
Since the fall, sales have sunk. And the government support is running out.
The latest sour news came Wednesday, when the Commerce Department said Nike Air Force
Shoessales of new homes fell last month to their lowest point on record. It was the fourth straight drop.
"While bad weather could well have suppressed the February result,air force it was
dismal no matter how one tries to slice and dice it," wrote Joshua Shapiro, chief U.S. economist at MFR Inc.
That news followed a report a day earlier that sales of existing homes fell for the third straight month in February, to their lowest level since July.
To cope with falling demand, the homebuilding industry has slashed the air force
shoespace of construction. But thousands of foreclosed homes have been dumped on the market at bargain prices. That glut has made it hard for builders to
compete.
Prices have followed sales down. The median sales price for previously occupied homes fell to $165,100 in February, down from a peak of $230,300 in July
2006, according to the National Association of Realtors.
Falling home prices mean builders can't recoup their construction costs. And that means fewer construction jobs.